4 Seasonal Business Survival Tactics

Unto every business, there is a season -- or few. With the December holidays looming, some businesses are in full ramp-up mode, hiring additional staff, managing more inventory, and taking in more money, says Jeff Liebel, a partner at Counterpoint Consulting, a management consulting firm in Williamsville, NY.

Whether your company’s busiest season arrives in the fourth quarter, during the summer, or at some other time of year, there are some best practices to managing the dramatic demand changes that seasonal businesses endure. Here are a few tactics to survive a seasonal rush.

1. Prep employees. Most successful seasonal businesses have training programs to prepare employees for the coming busy season, teaching them how to most efficiently and effectively serve customers and support other necessary areas of the business that are under greater demand.

"Let’s say your busy season is at the end of the year. You basically have six to eight weeks to ‘make’ the year. If your staff isn’t up to par, you’re going to have significant problems," Liebel says.

2. Mind the money. When much of your revenue comes in at one time of the year, managing cash flow can be a real challenge. Liebel says seasonal businesses must plot out their income and expense over the course of the year and adhere to their budgets.

A key mistake he sees seasonal businesses make is spending too freely during the flush months. Remember that the money has to stretch over months, and that you’ll likely have to reinvest in the business at times when much less money is coming in.

3. Use your off-season well. Seasonal businesses often have a few weeks or months of intense activity, then the day-to-day routine changes. That makes it difficult to improve from year to year because employees aren’t back in the cycle again for many months, Liebel says. He works with his clients on what he calls the "Master Operating Cycle," where employees are managing their day-to-day activities, but also preparing for business changes several months ahead.

"If you’re not looking ahead, you’re going to get into the busy season and spend a few weeks or a month just figuring it all out again," he says. Instead, regularly review seasonal demands and look for ways to streamline operations or to work ahead when possible, such as planning inventory checks and business planning during off seasons.

4. Find revenue streams for slow times. Some businesses make up for income fluctuations by finding new revenue streams or complementary business lines. For example, landscaping companies often handle property maintenance, plow snow, and install extensive holiday decorations during the winter in colder climates. Eateries that close after tourist season may offer catering or other food services. Seasonal product manufacturers might expand their lines or create holiday-specific products that can be marketed throughout the year.

Such expansion can help you keep employees busy, retaining your best talent. But think carefully before investing in a new line of business, Liebel says. "There are ‘good dollars’ and ‘bad dollars.’ Sometimes those other business lines can be bad dollars because they’re taking resources or time away from your primary business, which can hurt you in the long run," he says.

If the customer base is similar to the one you already have and the investment of time and resources isn’t putting your other business at risk, it could be a good move. Otherwise, focus on growing your primary business, Liebel says.